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DNO Denies Somaliland Exit

DNO has categorically denied that it intends to pull out of Somaliland after a team working for the Norwegian independent reportedly came under fire in the breakaway region of Somalia.

The team was carrying out a water survey for DNO in the Hudun area within its operated onshore exploration block SL-18 on 11 August when gunshots were reportedly fired in the vicinity at around 3:30pm, a company spokesman confirmed in an email to Upstream.

“No one was injured and the team was immediately repatriated to Hargeysa. The Somaliland authorities are investigating the matter further,” he stated.

The survey was being carried out as part of a DNO-funded project to provide local communities with safe drinking water. The company did not disclose the nationality of the team.

However, the spokesman added that “it is not correct that DNO is pulling out of Somaliland”, refuting local media reports that claimed the company was heading for the exit in the autonomous region due to the growing security threat.

Oslo-listed DNO holds a 60% operating stake in the block, its sole asset in the self-declared independent territory in north-west Somalia that it entered last year.

The explorer, which is targeting spending of between $10 million and $20 million on its Somaliland operations, has carried out a study of remote data and intends to gather more seismic data in the license.

However, deals signed by the regional administration with oil companies are deemed illegal by the Mogadishu-based central government.

“As in every country in which we operate, the safety and security of operations is our first priority,” the DNO spokesman said.

“We are in regular contact with the Somaliland authorities and closely monitor the security situation in Block SL-18.”

Somaliland’s Minister of Foreign Affairs Mohamed Behi Yonis was quoted as saying by the Wall Street Journal that he had heard about the Hudun gunfire incident but didn’t know the full details.

He said the region’s authorities were in the process of recruiting a security force of about 420 personnel, paid for by oil companies, to protect its oil assets. “We won’t have any events then,” he added.

The Somaliland move to form an independent security force has though reportedly come under scrutiny by United Nations monitors as Somalia is the subject of an arms embargo aimed at curbing years of conflict in the volatile Horn of Africa state.

Genel Energy has temporarily suspended seismic operations in Somaliland “due to a deterioration in the security environment”, having reportedly pulled out staff last year amid escalating violence.

“Discussions continue with the Somaliland government in order to facilitate a resumption of activity,” the London-listed company stated on its website.

The Anglo-Turkish company, led by ex-BP boss Tony Hayward, acquired operating stakes in five onshore blocks covering a total of 40,300 square kilometers – an area the size of Iraqi Kurdistan – in 2012 and is targeting resource potential of around 2 billion barrels of oil in the underexplored region.